Why You Shouldn't Raise VC in the Summer

By tremendousblog on July 29, 2024

When I e-mail my friends in VC during the summer, they often take 1-4 weeks to get back to me. Are you sure you want to raise right now?

Every year, venture fundraising hits two troughs: one in the summer, and another between Thanksgiving and New Year's. And yet, some founders raise at those times anyway.

Here's why I think that's a mistake…

Giving Yourself the Best Possible Shot

Raising millions of dollars is really hard. Why not give yourself the best possible shot?

Raising at a time when many VC's are on vacation puts you at a serious disadvantage. And you need every advantage you can get.

You don't want your company slowly running out of money while Jim the VC drinks spritzers on the Cote d'Azur. It's not a serious issue for Jim, but for you, it's existential.

Landing at the Bottom of the Inbox

Let's say you e-mail Jim today. He doesn't get back in the office for another 2 weeks.

When he finally sits down at his desk, you'll be at the bottom of his inbox. That means you'll be waiting even longer for a reply — if you get one at all!

You want to land right at the top. The best way to do that is avoid raising when people are out of the office.

When to Raise

If I were a founder, I'd start raising the first Monday after New Year's or the first Monday after Labor Day. That lets everyone get back from their vacation, get through their e-mail backlog, and be ready to do business.

A lot of VC's are lazy. You want to remove any possible excuses. "Oh, I'm just getting back from vacation, blah blah blah."

So, the next two ideal dates to start raising would be Monday, September 9 2024 and Monday, January 6th 2025.

What If You Can't Wait?

"But Francis, I'm almost out of runway! I can't wait till September."

I'm sorry, but this is a failure of planning on your part. It's best to raise from a position of strength, which means being breakeven.

If you can't do that, time your cash-out date carefully.

You want around 9 months runway in the bank when you start raising. Many raises take 6 months these days. You want to still have around 3 months cash in the bank by the time the round is closing.

Wrap-Up

Some founders raise successfully in the summer. And not all investors take the season off. In fact, I did 4 deals last August, my most ever in a month.

But the exceptions don't matter. We're talking about giving you the best possible odds of raising money.

And the best odds aren't in July when half the industry is eating gelato in Italy.

When do you think is the best time to raise?

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